HSN’s CEO Mindy Grossman on Culture Trumps Strategy (Transcript)

And I said let me ask you a question, “What does any other employee do on their first day?”

And she said, “Well, they go to employee orientation”.

And I said, “Well, I am going to go to employee orientation”.

And she said, “Really?”

I said, “Absolutely”, because it’s going to give me an insight, and I think it’s going to make people feel that it is different.

So there I am, my first day, I go into this room and there’s like, 25 people, and everybody goes around the table and introduces themselves. And somebody goes, well, I’m a merchandising assistant, I’m in backstage television, I’m in call center, and they get to me and I say I’m the new CEO. And you could see.

Well, that whole day I went to orientation. I was in the call center, I was in backstage television, I was going through creative, I was understanding the shows. I actually answered calls. Well what happened, it went viral. It went viral throughout the entire organization.

So by the next day when I got up and did my first townhall, A) it humanized me. B), it gave me context of how to articulate what it was we needed to do. And it made people feel that I was going to be accessible and authentic.

And so when I got up the next morning, and I said, here’s why I joined the company, and we were talking earlier about story telling. I knew the first story I had to tell was why was I there, why was I passionate about the future of this company, and I had to make it personal. But because I had that experience I was able to make it personal.

So all of a sudden people felt, that it is different. We do have a future. And we’re going to go with her on this path. And I think that really igniting the culture and being believable and then setting a vision is what changed the entire business dynamic.

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Interviewer: You’ve talked a lot about the importance of culture, and resetting the culture at HSN. A lot of leaders talk about the importance of culture. I’m wondering if you can pull back the curtain a bit for us and tactically, apart from townhalls and telling your personal narrative, how did you build the culture at HSN to what it is today?

Mindy Grossman: So the way I think about culture is I have 6,000 employees, every one of them go home at night, every one of them has neighbors, every one of them visit and somebody or they meet a new person and somebody goes who do you work for? You want that person to be your greatest evangelist. You want them to be proud of what they’re doing. And they’re embedding themselves in the culture. And very often when people come to visit at HSN, they say: oh, my God, it’s almost like a cult. I think that’s a good thing by the way, in a good way, not a bad way. So is Nike, so is Ralph.

So what I had to do was make employee engagement the number one priority of the company as while I was working on the brand and the business strategy. So with my executive leadership team, I said we’re going to make employee engagement our number one strategy. The second thing I did, was I was made it very clear to the organization what my expectations were. And there were three sort of people. There were the evangelists, that were like, woo-hoo, we finally have someone here who is going to like take us somewhere. The second group of people were like, sounds interesting, but let’s see. You know, they needed to give it time to get through the period. And then the third people were the blockers. They were the toxins, right?

I believe that you have to get rid of toxicity in any company that you have. I don’t care how smart, I don’t care how talented. I don’t care how long they’ve been there. If somebody is going to create a toxic environment you have to make a change. Well, I made it very clear to people. Here are my expectations.

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I think the other thing that’s important, I think too many CEOs who go into companies that are not performing make the incorrect assumption that everyone in the company is probably not talented. It’s usually because the leadership was not inspired and it wasn’t great leadership.

So what I had to do was do a talent assessment. And I had a lot of talented people, that were actually keeping the company together throughout this time. So I have the same, my CFO, who is now CFO and COO, Judy Schmeling has been there for 19 years. She’s been my partner throughout this whole thing. I’ve had the same head of HR, I’ve had the same operational people. But I did have to bring new people in to the front of the business who were going to have to understand what a lifestyle brand was and understand kind of what we were trying to accomplish. So I had to bring in a new head of television, I had to bring in a new head of creative. I had to make the company become a digital company et cetera.

But the number one thing I had to do was inspire people around a vision, and I think when I’m always asked about what are qualities of leadership, that ability to set that vision, and bring people along with you and inspire them to get there is critical.

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